The Chief Executive of the Nigerian Midstream and Downstream Petroleum Regulatory Authority, Farouk Ahmed, has urged stakeholders to set an index for crude oil and petroleum products pricing in Africa.
He noted that the absence of a regional pricing benchmark has hindered transparency, investment, and supply chain efficiency within the West African fuel market.
Ahmed disclosed this on Tuesday at the Global Commodity Insights Conference on West Africa’s refined fuel market, jointly organised by the NMDPRA and S&P Global Commodity Insights in Abuja.
He said, “As a region, we must begin to define our own pricing reality. Establishing a regional price index will not only improve price discovery and transparency but also deepen market development and enhance energy security.”
He disclosed that despite ongoing efforts to boost refining capacity and ramp up the local production of refined petroleum products, Nigeria and other West African countries still rely heavily on fuel imports, with nearly 69 per cent of their gasoline supply sourced from overseas markets.
He said this situation underscores the region’s continued dependence on external supply chains despite notable progress in domestic refining projects.
According to him, statistical data for 2025 indicates that an average of 2.05 million metric tonnes of gasoline is traded monthly in the region, with 69 per cent, approximately 1.44 million MT, being imported, while only 31 per cent (0.61 million MT) comes from regional refineries.
He explained that the reliance on imports has continued despite increased refining capacities in Nigeria, Ghana, Niger, Senegal, and Côte d’Ivoire, which collectively now produce up to 1.335 million barrels per day.
Ahmed said, “The regional supply of fuels in West Africa has grown through improved refining capacities in Nigeria, Ghana, Niger, Senegal and Côte d’Ivoire, which currently stands at 1.335 million barrels per day.
“Our 2025 statistical data for fuel supply in the West African region reveals that 2.05 million MT per month of Gasoline is being traded, consisting of 1.44 million MT (69 per cent) imports and 0.61 million MT (31 per cent) refinery contribution from the region.”
Despite West Africa’s status as a significant hydrocarbon producer and a growing refining hub, Ahmed lamented that the region remains dependent on pricing benchmarks set by distant markets such as Northwest Europe, the US Gulf Coast, Singapore, and the Arab Gulf.
“These global benchmarks do not fully reflect the unique supply chain peculiarities, logistics costs, and economic realities of the African continent,” he stated.
The NMDPRA boss stressed that Nigeria, under the leadership of President Bola Tinubu, has introduced key reforms such as the implementation of the Petroleum Industry Act 2021 and the liberalisation of the downstream sector, which have created a favourable climate for petroleum investments.
“These reforms are attracting investment into trade zones, digital market platforms, and refining projects,” he noted, adding that Nigeria is fast emerging as a key midstream and downstream trade and logistics centre for the entire West African coast.
He also pointed out that Nigeria’s deep seaports, improved maritime infrastructure, and an active coastline make the country strategically positioned to serve as a fuel distribution hub across the region.
“Nigeria’s refining sector is undergoing massive transformation, with projects like the Dangote Refinery and ongoing rehabilitation of state-owned refineries expected to boost local production significantly,” he said.
Referencing the OPEC World Oil Outlook, Ahmed stated that Africa is projected to add 1.2 million barrels per day of refining capacity between 2025 and 2030, with West Africa expected to play a substantial role in that expansion.
To support the regional market’s evolution, Ahmed said the NMDPRA was working closely with S&P Global Commodity Insights to develop price indices for refined petroleum products, including Premium Motor Spirit, Automotive Gasoil, Aviation Turbine Kerosene, and Liquefied Petroleum Gas.
“Our partnership with S&P Global aims to leverage their world-class market intelligence and our regulatory experience to launch pilot indices tailored to the West African energy market,” he added.
According to him, the proposed regional benchmark will promote market confidence, attract more investment in storage and supply infrastructure, and ensure real-time price visibility for operators across the fuel value chain.
“We are committed to building a transparent, data-driven market that reflects the true cost and value of fuel within West Africa,” Ahmed concluded.
